NetBank has reduced its customer acquisition costs this year by using Internet advertising and direct marketing while shunning offline branding, the company said. An e-mail-based customer acquisition strategy is also expected to launch by year-end.

Customer acquisition costs had increased to as much as $200 per customer late last year, NetBank said, but have since declined to $160-$170 per customer.

Michael Fitzgerald, president of NetBank, Atlanta, said its customer acquisition costs have fallen in an environment in which such costs have been rising.

"It's more expensive to acquire a customer now than it was a few years ago," he said. "There are more players, there's more clutter and there's more marketing that needs to be done that is included in that cost."

The company earlier this month said it added 22,000 new accounts during the second quarter, a 38 percent increase over the number of accounts added in the first quarter of this year and double the number of accounts opened in last year's second quarter. It now has about 104,000 deposit accounts.

Cost-per-customer acquisition remained "well below $200" in the second quarter, the company said.

Fitzgerald said the company's marketing is now done almost entirely through the Internet.

"Our best customer is already online," he said. "[Advertising online] is a lot easier than getting someone offline to remember your brand and then go to your site."

NetBank has enjoyed some success advertising through Internet portals, using pay-for-performance advertising with its online partners and using banner ads that link to pages offering incentives for customers to apply for and open an account.

In addition, the company has been using direct e-mail as a marketing tool, primarily to cross-sell products to its own customers, he said. The bank offers a range of financial services, including checking and savings accounts, money market accounts and certificates of deposit. Earlier this year NetBank also launched an agreement with Insurance.com, where customers can compare a variety of insurance products.

Fitzgerald also said the company planned to use e-mail more aggressively for customer acquisition.

"We have not done a real lot of that in terms of customer acquisition, but we are planning to roll out a lot of that in the next three to six months," he said.

He said the company is working with Internet services company marchFirst, Chicago, to develop an e-mail marketing strategy.